The price of software downloaded from the US or non-European Union (EU) countries could rise if new European Commission (EC) proposals become law.
EC ministers are moving to close a tax loophole that meant non-EU firms could offer VAT-free Internet downloads as the Net was not covered by existing law and they did not have to pay tax themselves.
Once the proposals have been made law, any non-EU company generating more than a total of 100,000 euros (£63,350) in electronic sales in EU member states will have to register for VAT in an EU state.
Once made into law, services downloaded for consumption within the EU will be subject to VAT, while those for consumption outside the EU will be exempt. All member states and the European Parliament must approve the changes before they can be implemented, but this is unlikely to happen before the end of the year.
Frits Bolkestein, EC taxation commissioner, said: "In modernising the VAT system to address the electronic delivery of services, stakeholders can participate on a fair and equitable basis in the development of the information society."
But analysts said the EU may have difficulty enforcing its proposals if non-EU companies refuse to register for VAT in a member state. This is because, in effect, until such firms do register for VAT in an EU-member country, European courts have no direct jurisdiction over them.
Moon's dark side is mountainous, rugged and never visible from the Earth
The groundwater basins in some areas of Tehran have been damaged irreversibly
This is the first time that any spacecraft on Mars has recorded air vibrations on the planet
Arctic sea ice is thickening at a faster rate during winter, thus slowing down long-term decline: NASA
But, the seasonal ice growth could only delay the demise of the Arctic ice cap for a few more decades